Lawmakers on Tuesday held an interim study at Oklahoma's State Capitol to examine the growing impact of large-scale data centers on the state's power grid and water resources.
The study, requested by Rep. Amanda Clinton (D-Tulsa), brought together energy experts, utility representatives and local officials to discuss the economic and environmental challenges posed by these high-demand facilities.
Data centers are massive warehouse-like buildings filled with servers, and operators are taking more interest in building them in Oklahoma. The facilities bring economic development and higher property values, but they also increase utility rates and use massive amounts of water.
Rising utility costs tied to data center demand
One of the study’s main focuses was the rising cost of electricity, which experts said is being driven in part by large-scale energy users like data centers.
“The core issue is that utility rates are just not designed to account for a rapid cost increase to serve a small number of really big customers,” said Mark Gribben, chief legislative analyst with Virginia’s Joint Legislative Audit and Review Commission. “It’s kind of unprecedented.”
Gribben, who talked to legislators Tuesday, has firsthand experience with the issue. Virginia is home to 13% of all data centers globally, making it the data center capital of the world.
He described utility rate regulation as “very complex” and “highly technical,” and emphasized the need for strong oversight to prevent residential customers from shouldering the costs.
“So, at the end of the day, you're really relying on your utilities and your regulators to make the appropriate changes,” Gribben said.
One potential solution being considered in other states is to create a separate rate class specifically for data centers. Last month, Dominion Energy proposed such a change in Virginia.
In Oklahoma, the Public Service Company of Oklahoma filed a proposal with the Oklahoma Corporation Commission in September that, if approved, would raise monthly residential bills by more than $10.
Oklahoma Gas & Electric expects to add about 60 cents to monthly bills in 2026, with that figure increasing to more than $4 by 2031.
A report from the Corporation Commission’s Public Utility Division earlier this year cited “rising electricity demand from large-scale data centers and AI infrastructure” as a major factor behind these rate increases.
Water concerns
In addition to energy usage, lawmakers also discussed the effect of data centers on local water supplies, particularly in areas like Payne County and Tulsa.
“I consider it my duty as a legislator to ensure that Oklahomans have clean, plentiful water for everyday use and recreation,” Clinton said. “At the end of the day, you can't drink data.”
Payne County Commissioner Rhonda Markum shared photos from constituents living near the Stillwater data center facility showing runoff and erosion due to the ongoing construction.
“I've got constituents that do live next to this facility that have been very upset,” Markum said. “This has not been a good start for them.”
A Stillwater HOA announced a lawsuit alleging the runoff is ruining the pond and hurting wildlife.
Environmental concerns surrounding data center construction is not unique to Oklahoma.
The BBC previously reported on similar issues in Georgia, where a woman blamed a Meta data center for sediment buildup in her water well.
Hyperscale data centers and their water demands
Newer “hyperscale” data centers, like Project Clydesdale and Project Anthem near Tulsa, require significantly more water than earlier models, primarily for cooling servers.
As mentioned at the meeting, one data center building uses a similar amount of water as a large office, but hyperscale data centers have multiple buildings. The center in Stillwater will have six on the Google campus.
According to a data center energy usage study, direct water usage by hyperscale data centers reached 7.5 billion liters in 2014.
That number is projected to rise to between 60 and 124 billion liters annually by 2028.
These estimates do not include indirect water use, such as the water needed to generate electricity.
The Tulsa World reported that Project Clydesdale alone could use up to 6.1 million gallons of water per day.
That level of consumption drew concern from lawmakers, including Rep. Mike Dobrinski (R-Okeene), who chaired the meeting.
“I have a big concern for water,” Dobrinski said. “I haven’t heard anything in the room today that gives me a great level of comfort that we have the ability to produce more.”
